With ongoing advancements in tracking technologies and the maturation of the internet economy, performance marketing has become important and central to advertisers, big and small. Establishing a referral program, aka affiliate/partner program is a necessary step to tap into the channel. In a previous post, I wrote about why and how to build a strong partner channel. In this post, I will focus on what it means to properly manage the channel, and why it pays off.
Managing The Channel
There are 3 main components in properly managing the performance marketing channel:
- Tracking/affiliate system
- Dedicated staff to manage the channel
- Payments to partners
In order to succeed at building an effective affiliate program, one that will drive lots of traffic and new customers to your brand – a company must get all 3 of them right.
Let’s Touch Base on Each Component
Tracking / Affiliate System
The system needs to provide maximum flexibility for setting rules, managing a large number of partner offers, promotions and reporting – internally for your team, so that they can effectively manage the partners, and externally for your partners – so that they can have maximum data points for optimizing the traffic that they send through to your website. One critical component of it is having the partner able to break down the traffic into small units, for granular optimization. This is sometimes referred to as a ‘dynamic id’ or ‘sub id’, sub tracking and so forth – each system with its own terminology.
Selecting or building a low-end system that does not support a dynamic parameter will not get your program far. So which platforms offer this capability? To get started with minimum overheads you can choose a platform such as Awin, or ShareASale. Those will plug you into their existing networks, and cover tracking and payments. You would still need a dedicated affiliate manager/team to manage your partners and make sure they are informed and incentivized!
The long-term solution is to build or integrate a system into your own site, for maximum flexibility and control. In this case, you will manage it under your own domain, and take care of payments yourself. Solid white-label options include CAKE, Cellxpert, HasOffers.
This is a critical component. If you give the channel to a certain marketing team member with a zillion other tasks, you might as well give up the channel altogether. Recruiting new partners, identifying high-quality partners and nurturing relationships are all a full-time job and require affiliate managers with capacity and targets. Companies which run a large affiliate channel may employ an affiliate management team. Too often we see companies fall short on this pillar: they invest in integrating a system, but have no one really work together with partners – and they, in turn, will not work for you – resulting in no results.
Payments to partners
Since you only pay for results (CPA / CPL / revenue share), your partners work hard to get these results and expect to be paid in a timely manner. You should generally make the payment no later than 15-20 days after month’s end. Many potential partners would be located abroad and as your channel grows, you need a payment system to pay out en-masse, hundreds and sometimes thousands of partners. If you work with a network such as Awin – you will make a single payment to them and they will take care of distributing the payment for you. If you run your own system – you’ll have to build this mass payout system on your own, or use mass payout services such as Payoneer or Tipalti.
Why it Pays Off
Having a significant performance channel will fuel your growth, and help expand your brand recognition too. Partners can help you spread out your brand faster and stronger than you could ever do with internal resources, large as they may be. Niche sites, non-English languages, comparison sites, social media and others – all these venues will be incentivized to promote your brand and drive quality traffic (as they won’t be paid for non-converting users). The scaling opportunity is immense, while you keep costs under control – only paying out from real customers or real revenue generated.
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